"To get the
economy going again we must rebuild consumer confidence," say the Wall
Street wags. What they yearn for is the good old bubble days when
consumers happily loaded up with debt. That was that not-so-long-ago time
when lenders chased after borrowers to ply them with abundant cash.
Remember the credit card offers? The astonishing home mortgage
deals?

Suddenly the game has
changed. Something went horribly wrong and millions of Americans who
were living the good life on borrowed money are overwhelmed by debt that's
made them miserable. They are staying away from shops and auto showrooms
in droves. Their confidence is shot, along with their budgets.
Bankruptcy courts are clogged as people look for an escape route. Repo business
is brisk. Foreclosure lawyers are busier than ever.

What's to be done?
Can't Washington just run those money printing presses overtime to pump cash
into the economy? How about mailing every American a $5,000.00 check to
jump-start the economy? Surely, if the trouble is merely a shortage of
money we can fix it by just creating a few billion
more dollars for the masses.

A Zimbabwean
style hyperinflation is unlikely to happen in the U.S. After some
sixty-eight years of inflationary policy we're more apt to be headed into a
deflationary recession. The present run of price inflation began in 1940
and, except for slight dips in 1949 and 1955, every year has seen the Consumer
Price Index rise. In October the CPI collapsed a full percentage point,
the biggest one month drop since the index was begun in 1947.
Politicians and Federal Reserve officials are worried about their ability to
get inflation going again.

What, exactly, is the
matter with money? How could it be so abundant only a few months ago and
suddenly so scarce today that cities, states, manufacturers, and financial
institutions are lining up at the Treasury Department, hats in hand, begging
for bailouts?

Blame Congress. Right
under our noses it allowed the money unit of the United States to be
transformed from the discipline of the U.S. Constitution into irredeemable
scrip. Today's currency doesn't even meet the historic definition of
money. It represents debt and nothing more. Ever so slowly the U.S.
morphed in the twentieth century from the healthy restraints of commodity money into an
irrational financial system based almost entirely on debt. Most citizens could
summon large sums into existence merely by presenting a credit card to a
seller.

Now our debt-based economy
is entering an inevitable correction which promises to be embarrassing for a
nation that grew to international prominence on sound
money. It seems incomprehensible today, but the wholesale price level in
the U.S. remained amazingly steady from 1792, when the dollar was adopted as
the nation's money unit, to 1914 when a newly created central bank began
operations. The dollar of 1914 has now sunk to 5¢ thanks
to decades of monetary inflation created by Congress with the help of the Federal
Reserve System.

Before the dollar reaches
zero Americans should demand a national conversation about the debauchery of
the once mighty U.S. dollar and insist that Congress do the one thing that
will restore confidence and trust in the nation's money unit - - replacing the
debt-money scheme with the honest money demanded by the
Constitution.

Thomas Jefferson, who
invented the U.S. money system, warned of the damage debt-money (paper) could
cause. In a letter to Albert Gallatin in 1818 he wrote, "The flood
with which the bankers are deluging us of nominal money has placed us
completely without any certain measure of value, and, by interpolating a false
measure, is deceiving and ruining multitudes of our
citizens."

In an earlier letter to
Thomas Cooper, Jefferson wrote, " Our whole country is so fascinated by
this Jack-lantern wealth [it] will not stop short of its total and fatal
explosion."

Franklin Roosevelt began
removing the dollar from its moorings in 1933. Richard Nixon finished
the job in 1971. From a monetary unit based on something of
intrinsic value we're now doing business with "money" backed by
nothing of value. We're about to be punished for
allowing it to happen.

Let's talk about restoring
the United States to a system of honest money! Surely there's still a
market for honesty.